Nevada Gold & Casinos Reports Fourth Quarter Results

For the fourth quarter of fiscal 2014, the company reported net revenues of $16.0 million compared to $16.5 million in the fourth quarter of fiscal 2013. Operating expenses decreased to $14.8 million compared to $15.5 million in the prior year period. Operating income from continuing operations increased to $1.3 million compared to $1.1 million in the prior year period. Income before taxes also increased to $1.0 million compared to $0.7 in the prior year period. Net income from continuing operations was $0.7 million, compared to $0.5 million in the prior year period.

During the fourth quarter, net revenues from Washington were $14.1 million, a slight decrease from the $14.2 million in the prior year period, however, EBITDA improved slightly to $2.3 million compared to $2.2 million in the prior year period. South Dakota route operation revenues decreased to $1.9 million from $2.3 million in the prior year period, primarily due to a reduction in units. EBITDA declined to $83,000 for the quarter, compared to EBITDA of $147,000 in the prior year. Corporate expenses were $0.5 million compared to $0.7 million in the prior year period. On a consolidated basis, adjusted EBITDA was $1.9 million compared to $1.7 million in the prior year period. Net interest expense decreased to $157,000 compared to $393,000, in the prior year period.

"Our fiscal fourth quarter reflects the first full benefit of our debt refinancing completed last December. With the reduced interest expense and solid operating performance, we expect to generate strong earnings growth and free cash flow in fiscal 2015 and forward," said President and CEO Michael Shaunnessy.

For the full fiscal year 2014, net revenues were $62.8 million compared to $65.9 million in fiscal year 2013. Operating expenses were $60.5 million compared to $63.5 million in the prior year. Operating income from continuing operations was $2.3 million compared to $2.4 million in fiscal 2013. Income before taxes was $0.7 million compared to $0.7 million in the prior year period. Net income from continuing operations was $0.5 million compared to $0.1 in the prior year.

(1) Non-GAAP Information

The term "adjusted EBITDA" is used by us in presentations, quarterly earnings calls, and other instances as appropriate. Adjusted EBITDA is defined as net income before interest, income taxes, depreciation and amortization, non-cash goodwill and other long-lived asset impairment charges, write-offs of project development costs, litigation charges, non-cash stock grants, non-cash employee stock purchase plan discounts, exclusion of net income or loss from operations held for sale, and net losses/gains from asset dispositions. Adjusted EBITDA does not take into account greater or less than expected hold percentages in the gaming operations. Adjusted EBITDA is presented because it is a required component of financial ratios reported by us to our lenders, and it is also frequently used by securities analysts, investors, and other interested parties, in addition to and not in lieu of, U.S. Generally Accepted Accounting Principles ("GAAP") results to compare to the performance of other companies that also publicize this information. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to net income as an indicator of our operating performance or any other measure of performance derived in accordance with GAAP.

Adjusted EBITDA reconciliations for the three months and fiscal years ended April 30, 2014 and April 30, 2013 are shown below:

Adjusted EBITDA reconciliation to net income:

For the three months ended

April 30, 2014

April 30, 2013

Net income

$ 646,089

$ 452,434

Add:

Income tax expense (benefit)

399,239

211,065

Net interest expense (income)

156,669

392,757

Depreciation and amortization

571,245

498,764

Loss on settlements - sale of assets

11,676

986

Deferred rent

(3,537)

19,034

Stock option amortization

13,620

13,620

Employee stock purchase discount

1,391

--

Decrease in swap fair value

58,352

--

Relocation expenses

--

127,029

Adjusted EBITDA

$ 1,854,744

$ 1,715,689

Adjusted EBITDA reconciliation to net income:

For the fiscal year ended

April 30, 2014

April 30, 2013

Net income

$ 447,981

$ 36,097

Add:

Income tax expense (benefit)

282,758

560,052

Net interest expense (income)

1,222,904

1,704,027

Depreciation and amortization

2,263,499

2,126,888

Loss on settlements - sale of assets

27,605

6,081

Deferred rent

14,536

76,136

Stock option amortization

54,479

137,858

Employee stock purchase discount

7,384

--

Loss on debt extinguishment

283,550

--

Decrease in swap fair value

58,352

--

Relocation expenses

--

127,029

Severance expense

--

637,868

Impairments, write-offs, recoveries, net

56,959

257,733

Loss on operations held for sale

--

91,603

Adjusted EBITDA

$ 4,720,007

$ 5,762,182

Forward-Looking Statements

This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We use words such as "anticipate," "believe," "expect," "future," "intend," "plan," and similar expressions to identify forward-looking statements. Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional gaming and other projects. These statements are only predictions and are subject to certain risks, uncertainties and assumptions, which are identified and described in the Company's public filings with the Securities and Exchange Commission.

About Nevada Gold & Casinos

Nevada Gold & Casinos, Inc. (NYSE MKT:UWN) of Las Vegas, Nevada is a developer, owner and operator of 10 gaming operations in Washington (wagoldcasinos.com) and a slot route operation in Deadwood, South Dakota (dakotaplayersclub.com). The Company also has a social gaming application, Gold Star Slots, available on Facebook and in the Apple store. For more information, visit www.nevadagold.com.

Nevada Gold & Casinos, Inc.

Consolidated Balance Sheets

April 30,

April 30,

2014

2013

ASSETS

Current assets:

Cash and cash equivalents

$ 7,738,985

$ 6,723,919

Restricted cash

1,388,995

1,306,487

Accounts receivable

252,504

445,481

Prepaid expenses

829,228

854,092

Deferred tax asset, current portion

98,643

67,123

Notes receivable, current portion

332,973

216,596

Inventory and other current assets

344,686

373,923

Total current assets

10,986,014

9,987,621

Investments in development projects

--

56,959

Real estate held for sale

1,100,000

1,100,000

Notes receivable, net of current portion

1,730,246

2,082,853

Goodwill

16,103,583

16,103,583

Identifiable intangible assets, net of accumulated amortization of $5,619,009 and $4,413,439 at April 30, 2014 and April 30, 2013, respectively

5,754,167

6,959,738

Property and equipment, net of accumulated depreciation

of $3,632,349 and $2,599,940 at April 30, 2014 and

April 30, 2013, respectively

4,289,178

5,028,122

Deferred tax asset, net of current portion

4,356,972

4,671,250

Other assets

486,466

533,860

Total assets

$ 44,806,626

$ 46,523,986

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities

$ 1,427,010

$ 2,024,465

Accrued interest payable

37,470

34,393

Other accrued liabilities

2,178,317

2,127,140

Long-term debt, current portion

1,625,000

1,280,000

Total current liabilities

5,267,797

5,465,998

Long-term debt, net of current portion

10,725,000

12,930,000

Other long term liabilities

486,870

421,253

Total liabilities

16,479,667

18,817,251

Stockholders' equity:

Common stock, $0.12 par value per share; 50,000,000 shares authorized; 16,980,676 and 16,864,122 shares issued and 16,197,839 and 16,081,285 shares outstanding at April 30, 2014, and April 30, 2013, respectively

2,037,689

2,023,705

Additional paid-in capital

24,578,117

24,419,858

Retained earnings

8,648,727

8,200,746

Treasury stock, 782,837 shares at April 30, 2014 and April 30, 2013, at cost

(6,932,035)

(6,932,035)

Accumulated other comprehensive loss

(5,539)

(5,539)

Total stockholders' equity

28,326,959

27,706,735

Total liabilities and stockholders' equity

$ 44,806,626

$ 46,523,986

Nevada Gold & Casinos, Inc.

Consolidated Statements of Operations

Three Months Ended

Twelve Months Ended

April 30,

April 30,

April 30,

April 30,

2014

2013

2014

2013

Revenues:

Casino

$ 14,093,561

$ 14,651,475

$ 55,332,569

$ 58,393,105

Food and beverage

2,577,761

2,510,539

10,053,883

10,103,913

Other

447,161

443,607

1,742,710

1,808,538

Gross revenues

17,118,483

17,605,621

67,129,162

70,305,556

Less promotional allowances

(1,085,552)

(1,086,239)

(4,321,768)

(4,381,638)

Net revenues

16,032,931

16,519,382

62,807,394

65,923,918

Expenses:

Casino

7,810,946

8,155,865

32,081,242

33,016,277

Food and beverage

1,292,352

1,270,391

5,114,077

4,838,447

Marketing and administrative

3,991,514

4,095,164

16,369,505

16,652,746

Facility

490,906

564,070

1,951,314

2,270,774

Corporate and legal expense

544,168

795,361

2,384,596

4,051,972

Depreciation and amortization

571,245

498,764

2,263,499

2,126,888

Loss on settlements - sale of assets

11,676

986

27,605

6,081

Write-off of project development costs

--

--

56,959

257,733

Other

59,775

82,525

263,052

310,411

Total operating expenses

14,772,582

15,463,126

60,511,849

63,531,329

Operating income from continuing operations

1,260,349

1,056,256

2,295,545

2,392,589

Non-operating income (expenses):

Interest income

31,677

34,398

133,404

120,349

Interest expense

(138,929)

(345,512)

(1,097,005)

(1,494,989)

Interest rate swap expense

(26,912)

--

(26,912)

--

Decrease in swap fair value

(58,352)

--

(58,352)

--

Amortization of loan issue costs

(22,505)

(81,643)

(232,391)

(329,387)

Loss on extinguishment of debt

--

--

(283,550)

--

Income before income tax

1,045,328

663,499

730,739

688,562

Income tax expense

(399,239)

(211,065)

(282,758)

(560,052)

Net income from continuing operations

646,089

452,434

447,981

128,510

Net loss from operations held for sale, net of taxes

--

--

--

(91,603)

Net income

$ 646,089

$ 452,434

$ 447,981

$ 36,907

Per share information:

Net income per common share - basic and diluted for continuing operations

$ 0.04

$ 0.03

$ 0.03

$ 0.01

Net loss per common share - basic and diluted for discontinued operations